A common services agreement is actually a resource-sharing agreement. It is a way to reduce costs, improve efficiency and standardize certain processes. In that case, the service provider shall be responsible for maintaining certain key performance indicators or picis, such as the quality and costs of the distribution joint venture. The agreement should specify details such as the time for which the service can be used by each party, the safety of the service, the allocation of maintenance costs, etc. This should be done clearly in order to avoid conflicts about them in the future. Shared services differ from centralized services in that they have the power and ability to buy or buy elsewhere, as long as it is done within certain parameters. In a recent setup, many companies may prevent outsourcing for the first year or more, in order to give their internal service units the time they need to update. When this point is reached and business units feel that outsourcing offers them better opportunities or serves them better, they can start outsourcing if the service is subject to high-level verification by a board of directors. The decision to allow outsourcing is not taken lightly, as it can dilute savings of a certain size, although some companies may still opt for outsourcing if the decision is supported by an overall benefit to the business economy.
In the contentious society in which we all live today, it is very important to have a solid agreement. The Common Services Agreement is the easiest to approve legally if it is drafted in a brief and concise manner. A simple and short agreement facilitates the establishment of other public bodies on the same side. A shared service agreement template is used by companies to provide business support services.3 minutes read Suppliers responsible for meeting these requirements should have their performance regularly evaluated based on measurable criteria. Essentially, the shared services unit becomes another business entity that is perceived and managed like any external provider and has to compete in both price and service. While shared service models offer many advantages, the configuration has a few disadvantages. Some business unit leaders don`t like loss of control and often worry about the responsibility of service providers. Some argue that cost reductions also come with a loss of quality.
A shared services environment treats the business as if they were customers and provides external services. In this configuration, both parties must agree on the level of service as well as the quantity and costs. It also allows the service unit to leverage resources from internal and external sources as well as outsourcing and joint ventures. It`s important to remember that the more flexible you make your agreement, the more versatile the agreement will be. Don`t be too narrow and specific when drawing up the agreement. For example, you do not need to limit certain types of devices used or the specific services you agree to provide. An agreement that is too specific locks you in and puts you in the narrowness to respect the specific conditions. If you want to unblock services that were not taken into account when drafting the agreement, you cling to the restrictions already designed. .